In order to apply for the suspension of a procedure pursuant to Article 46 of the Civil Execution Act, which is applied mutatis mutandis by Article 275 of the Civil Execution Act with respect to an auction procedure for exercising a real estate security right, whether a lawsuit claiming the validity of a security right ought to be filed first (affirmative), and whether the court of the lawsuit seeking the cancellation of a security right may suspend its enforcement beyond the scope of the party’s application (negative in principle)

Articles 44, 46(2), 47 and 275 of the Civil Execution Act

Supreme Court Order 2012Ga173 Decided August 14, 2012 (Gong2012Ha, 1539)

The Do Real Asset Management Loan Co., Ltd.

Cheongju District Court Order 2018Kadan5018 dated March 27, 2018

Of the lower judgment, the part of the lower court’s order suspending its execution exceeding the part of 13,306 square meters of forests and fields ( Address 1 omitted) in Chungcheong-si among the execution of the real estate auction case at Cheongju District Court Decision 2014Tju-do 2958, is reversed. The remainder of the special appeal is dismissed.

The grounds of special appeal are examined.

1. A. A. In order to suspend an auction procedure to enforce a security right to real estate, a lawsuit seeking the validity of the security right may be filed and the progress of the auction procedure may be suspended upon a decision to suspend compulsory execution corresponding to Article 46 of the Civil Execution Act (Article 275 of the Civil Execution Act). Such a request for suspension of compulsory execution is premised on the assumption that an action on the same merits as a lawsuit demanding cancellation of the right to collateral security or a lawsuit seeking confirmation of existence of the secured obligation is filed (see Supreme Court Order 2012Da173, Aug. 14, 2012, etc.).

In addition, Article 46(2) of the Civil Execution Act provides that the court of lawsuit may order the suspension of compulsory execution with or without having the security furnished until a judgment is rendered upon request of a party. Article 47 of the Civil Execution Act provides that the court of lawsuit may issue an order under Article 46 in the judgment of a lawsuit of demurrer and revoke, modify, or authorize the order already issued. Therefore, as a lawsuit seeking cancellation of a right to collateral security, the court of lawsuit may not suspend its execution beyond the scope of the party’s request, unless the judgment is rendered simultaneously.

B. The record reveals the following facts.

1) The registration of creation of a mortgage was completed as of March 4, 2009, received on March 4, 2009, No. 9906, with respect to forest land ( Address 2 omitted) 58,632 square meters (hereinafter “instant land before the instant partition”) and ( Address 3 omitted) 289 square meters prior to the instant partition (hereinafter “mortgage-mortgage”).

2) On April 17, 2014 with respect to the instant land and the said ( Address 3 omitted), etc., prior to the instant partition, the decision to commence the auction of real estate was rendered on April 17, 2014 by Chungcheong District Court, Chungcheong District Court, 2014ta-2958, which was based on the instant right to collateral security (hereinafter “instant auction”).

3) On February 6, 2017, from the land before the instant partition, the land was divided into 13,306 square meters of forest land ( Address 1 omitted) in Chungcheongnam-si (hereinafter “instant land”). The Nonparty owned the instant land solely as a partition of co-owned property.

4) The Nonparty sought cancellation of the registration of the establishment of the instant mortgage, which was completed on the instant land, against a special appellant who succeeded to and acquired the instant right to collateral security, from the Cheongju District Court Decision 2017Da4334, Cheongju District Court Decision 2017Da4334, but lost the first instance court.

5) Accordingly, the Nonparty appealed to Cheongju District Court No. 2018Na6168, and filed an application for the suspension of the execution of the instant auction on the instant land until the said appellate court rendered a judgment.

6) However, on March 27, 2018, the lower court decided that the compulsory execution of the instant auction case shall be suspended until the said appellate court rendered a judgment.

C. Examining the above facts in light of the legal principles as seen earlier, with respect to the remaining auction procedure except for the part concerning the instant land during the instant auction procedure, the lower court did not have filed a lawsuit, such as a claim for cancellation of collateral security, and the parties did not have sought suspension of its enforcement, and the lower court cannot suspend its enforcement.

Nevertheless, since the court below suspended the execution of the portion exceeding the part regarding the land of this case during the auction procedure of this case, such order of the court below is deemed to have violated the right to a fair trial in accordance with the legitimate procedure of the special appellant, thereby affecting the conclusion of the judgment. The ground for special appeal pointing this out has merit.

2. As to the remaining grounds of appeal

A special appeal may be filed only on the ground that there exists a violation of the Constitution affecting the judgment, or that it is unreasonable to determine whether the order, rule, or disposition, which is the premise of the judgment, is in violation of the Constitution or any Act, which is the premise of the judgment, does not constitute the remainder of the grounds for special appeal asserted by a special appellant. In addition, among the order of the court below, the part ordering the suspension of the auction procedure of this case on the land of this case

3. Therefore, of the order of the court below among the auction procedure of this case, the part ordering the suspension of its execution exceeding the part regarding the land of this case is reversed, and the remaining special appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench

Justices Park Jung-hwa (Presiding Justice)